Tuesday December 15 was a good day for U.S.
renewable energy companies. In a landmark deal that could
mark the first time the Senate and House Republicans and
Democrats under Barack Obama were able to compromise on
anything at all, the two parties released an omnibus spending
bill that lifts the 40-year U.S. oil export ban and gives a five-year
extension of renewable energy tax credits for wind and solar.

Solar Industry Exuberant

The bill extends the Investment Tax Credit (ITC) for solaruntil 2021. It was originally expected to sunset at the end of2016, which was forcing developers to rush to finish projects.In a session during the Renewable Energy World Conferenceand Expo in Dec. 2014, Julie Ungerleider of Coronal Groupexplained that because of the hard stop that the ITC created,solar projects that were not already “fully baked” wereunlikely to be able to be built by 2016. She said materialshortages were rampant with the rush to build now. Thisextension should relieve some of that pressure.

The ITC will be extended until December 31, 2019 in
its current form. After that projects that start construction
in 2020 and 2021 will receive 26 percent and 22 percent,
respectively. All projects must be completed by 2024 to
obtain these elevated ITC rates. For residential solar, a similar
tax credit phase-out applies until December 31, 2021, after
which the tax credit scheme ends.